Executive Order 936/20 (MP 936/20), published on April 1, aims to mitigate the damage caused by the covid-19 pandemic by introducing measures such as a proportional reduction in work hours and salary and temporary suspension of employment contracts. The text also amends provisions of the CLT and presents rules on employment guarantees and on the actions of labor inspection agencies.
Executive Order 927/20 (MP 927/20), published on March 22, refers to the actions of labor inspectors of the Ministry of Economy, making changes in the inspection of labor issues. For a period of 180 days after the publication of the order (according to article 31), agents shall serve to provide guidance regarding irregularities found.
During this period, infraction notices shall be issued only for serious infractions, provided for in subsections I and IV of article 31. Auditors shall be charged with guiding companies on how to remedy other irregularities, instead of fining them.
MP 936/20 complements the provisions of MP 927/20 on labor inspection by establishing that failure to comply with the procedures for reaching agreements to reduce work hours and wages or to temporarily suspend employment contracts will lead to the issuance of an infraction notice.
The sole paragraph of article 14 provides that the process of inspection, notice, assessment, and imposition of fines must comply with the rules contained in Title VII of the Consolidated Labor Laws (CLT), which deals with the penalties and the processing of administrative proceedings, establishing the inapplicability of the criterion of the double visit and the rule of article 31 of MP 927/20.
In the event of non-compliance with the procedures relating to the measures provided for in MP 936/20, pursuant to the head paragraph of article 14, a fine shall be imposed, as provided for in article 25 of Law No. 7,998/90, which regulates the Unemployment Insurance Program. This provision refers to the fine provided for in subsection I of article 634-A of the CLT, as amended by Executive Order 905/19 (MP 905/19), which establishes a scoring system in accordance with letters "a" to "d".
Although MP 905/19, known for introducing the Green and Yellow Employment Contract, provides for new criteria for the imposition of administrative fines, no specific regulations have yet been defined by the Federal Executive Branch regarding the classification of the seriousness of violations, whether light, medium, serious, or very serious.
Thus, in the event of violation of the procedures for adoption of the measures introduced by MP 936/20, one applies the rule set forth in article 25 of Law No. 7,998/90, before the amendment provided by MP 905/19. The amounts vary between R$ 2,132.98 and R$ 213,297.65, fixed according to the number of employees affected. The fine may be doubled in the event of recidivism, opposition to supervision, or contempt of authority.
In view of this scenario, MP 936/20 reiterates the federal government's concern with the inspection and fining of companies in the event of non-compliance with serious obligations, activities of extreme importance, especially for the procedures applicable to the proportional reduction of work hours and salary and temporary suspension of employment contracts.
Article 19 of MP 936/20 itself proves the federal government's intention to reinforce the need for companies to comply with labor rules, especially those regulating occupational safety and health.
After various criticisms of the provisions of article 31 of MP 927/20 regarding the actions of guidance by labor inspectors, blocking, for 180 days, the issuance of infraction notices on matters other than those set forth in subsections I to IV, the inclusion of article 19 in MP 936/20 demonstrates the unequivocal need for companies to continue complying with other labor obligations.
 Employers who violate the provisions of this law will be subject to fines of 400 to 40 thousand BTN, according to the nature of the violation, its extent, and the offender’s intent. The amount shall be doubled in the event of recidivism, opposition to supervision, or contempt of authority.